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Mortgage broker fee query - please help

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Hello

I am currently working through an application with a Mortgage broker. My query is that his key facts document "about our services" has ticked that "a fee of up to £1995...... will be payable", rather than "No Fee".

In all my initial conversations I was told that no fee was payable. I questioned him about this and was told that no fee was payable and that this was ticked to cover the company in case of excessive costs, e.g if credit checks are failed.

Is the standard practice? I was expecting to see the no box ticked. Would he be able to send us a big invoice after verbally assuring me that no fee will be charged?

Thanks

Comments

  • homer_j_3
    homer_j_3 Posts: 3,266 Forumite
    I would walk away - it don't cost £1995 for this.

    To my understanding - the correct practice would be to issue a Key Facts document saying that the advice is free on the basis that the adviser is presuming - no credit problems etc.

    An explanation should then follow that if the information provided is fundamentally incorrect with your credit file or income etc, then he will reissue another keyfacts to reflect the fee that they wish to charge for the difficulty of placing your case.

    To me, this kind of practice is the shoddy practice that gives people like me a bad name!!!
    I am a Mortgage Adviser
    You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
  • dunstonh
    dunstonh Posts: 119,624 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Combo Breaker
    Wow. £1995 for processing a mortgage. Thats more than I get paid on a more advanced transaction of building a £200,000 portfolio. £1995 is a rip off for a mortgage.
    Is the standard practice?

    No. You cannot say no fees but have the fee box ticked. Its a lie.

    The adviser is allowed to factor in a cost if you dont proceed but there is a section later on which shows what happens with regards to fees if you dont proceed and other events. i.e. if you proceed, is the fee waived. If you dont proceed, then you will have to pay X amount of the fee. To charge a £1995 fee if you proceed is a rip off. To charge it if you dont is even worse.
    Would he be able to send us a big invoice after verbally assuring me that no fee will be charged?

    If its not on paper, it didnt happen. The key facts about our services is the main document on this and you should rely on what that says and not what the individual says. First impressions here are the fee is massive and the key facts document isnt very clear. Whats it going to be like when he gets on to explaining the important bit about the mortgage?
    I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
  • Big_McCal
    Big_McCal Posts: 5 Forumite
    Thanks Homer

    This whole process hasn't felt right for a bit. The broker began the application two weeks ago. Do you know if we can take over the application process and dump the broker? Or would we have to start all over again?

    I have an application reference from the lender, can I call them and explain?

    Thanks
  • homer_j_3
    homer_j_3 Posts: 3,266 Forumite
    who is it with?
    I am a Mortgage Adviser
    You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
  • Big_McCal
    Big_McCal Posts: 5 Forumite
    Bank of Ireland
  • homer_j_3
    homer_j_3 Posts: 3,266 Forumite
    has valuation taken place?
    I am a Mortgage Adviser
    You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
  • This is a Scottish property. Valuation has taken place. I had to commission a valuation survey as soon as my bid was accepted and before I applied for the mortgage. This is being forwarded to BoI.
  • homer_j_3
    homer_j_3 Posts: 3,266 Forumite
    ahh i see - of course - didn't put the aberdeen link to scottish law - must be tired lol.

    without seeing all paperwork - it would be wrong for me to say what todo either way. find a fee free broker and show them the paperwork. Hopefully a recommendation will come on here for a good broker.
    I am a Mortgage Adviser
    You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
  • herbiesjp
    herbiesjp Posts: 8,499 Forumite
    Just to back up what has been said

    The NO FEE box should have been ticked if that is what was said to you - this is so disheartening.

    If you are fee free and agree that with the client at the outset then that is the box that is ticked. If the advise wants to cover costs, then they would include an admin fee.

    However to leave it open up to £1995 is just scandalous

    As dunstonh says - your course of action will be dictated by what is said in the rest of the document about fees

    HTH
    I am a Mortgage Adviser
    You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
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